BUDGET 2013: Fast facts

Where the money went: The winners and losers from the 2013 federal budget.

WINNERS 

Infrastructure

– An additional $24 billion funneled into nation-building infrastructure, including funds for public rail projects in Brisbane and Melbourne, as well as a link between the F3 and M2 motorways and the upgrade of the M4, in Sydney.

– An extra $12.9 million was set aside to connect more local councils to the National Broadband Network.

Health

– The federal budget commits an extra $1 billion to the states’ hospitals.

– It also confirms that the Medicare levy will be increased to 2 per cent of taxable income from July 2014. The budget estimates $20.4 billion will be raised from the increase between 2015 and 2019, which would be placed in a fund for 10 years and could only be drawn upon to fund the DisabilityCare scheme. This means the average Australian, earning $70,000 a year, will pay an extra $365 a year (an additional $1 a day in Medicare Levy).

Schools/Education

– The budget commits $2.9 billion over six years ($473.3 million a year) to fund the Gonski education reforms.

– The government will inject $28.4 billion into education in fiscal 2013, with schools accounting for $12.4 billion. In fiscal 2014, $29.7 billion will be allocated to education. This includes $9.8 billion over six years for a new needs-based funding model for schools that increases Commonwealth funding for schools to a total of $104.3 billion from 2014 to 2019.

– $660 million will be spent to continue the National Partnership to promote universal access to preschool.

Higher education

– The government allocated $97 million to increase the number of Commonwealth-supported university places and an additional $186 million for research infrastructure.

Seniors

– The budget commits $127 million for older Australians, including $112.4 million to support those downsizing their homes, $9.9 million to extend broadband support and $4.6 million for a new ageing policy institute. From July 1, 2014, senior Australian homeowners who have owned their family home for at least 25 years and who decide to downsize will have the option to invest surplus funds of up to $200,000 in an account of up to 10 years on a means-tested basis.

– The budget also allocates $9.9 million to extend broadband support and $4.6 million for a new ageing policy institute.

Disability

– The budget allocates $14.3 billion in new investment for DisabilityCare Australia, a national disability insurance scheme that will be paid for with a 0.5 percentage point increase in the Medicare levy to 2 per cent of taxable income from July 2014. The government estimates $20.4 billion will be raised from the increase between fiscal 2015 and fiscal 2019, which would be placed in a fund for 10 years and could only be drawn upon to fund the DisabilityCare scheme.

Health

– $226 million to fight cancer, including $55.7 million for breast cancer screening.

– $18.5 million for prostate cancer research.

– $23.8 million for bone-marrow transplants.

– But many Australians are expected to be hit by a phase-out of the net medical expenses tax offset over the next two years, which will save the budget nearly $1 billion over four years. However, claims for aged care, disability aids and attendant care will be allowed through until June 30, 2019 when DisabilityCare is rolled out across the country.

LOSERS

Corporate businesses

– The federal government will move to close corporate tax loopholes in exploited by multinational enterprises and large domestic companies. The crackdown will feature a targeted approach to address “aggressive tax structures”, also known as thin capitalisation, that seek to shift profits by artificially loading debts into Australia. It will also address loopholes in the Offshore Banking Unit and the consolidation of business entities regime. These moves are expected to raise $4.2 billion over four years. The crackdown will focus on profit shifting and dividend washing.

– The government will also inject an additional $109.1 million into the Australian Tax Office for targeted compliance activities in the corporate sector.

– Pay-as-you-go income tax instalments will shift from quarterly payments to monthly and be extended to include all large entities in the PAYG system including trusts, superannuation funds, sole traders and large investors. The government expects the measure to net $1.4 billion in tax receipts over the forward estimates period.

Energy and resources

– The budget defers $370 million of funding from the Australian Renewable Energy Agency – ARENA – over three years, beyond the forward estimates. As a result the program will be extended to 2021/22.

– Renewables: $225.4 million will be deferred and $32.3 million redirected from the biodiversity fund. $58 million in funding for the Clean Technology Program moved to 2017-18.

– $500 million in funding will be withdrawn from the Carbon Capture and Storage Flagships Program over three years.

– $29 million in funding will also be withdrawn from the Coal Mining Abatement Technology Support package, over two years from 2015-16.

– Resources: Tighter rules on exploration deductions for miners that give the government $1.1 billion over four years. $500 million cut from carbon capture and storage programs.

– Exploration deductions have been targeted. From July 1, 2014, the government removes depreciation concessions available to large resource companies that purchase junior miners and then claim their exploration costs and mining rights for immediate depreciation. This measure will raise $1.1 billion over four years.

Income tax payers

– As previously announced, the budget defers a series of personal income tax cuts tied to the carbon price at a saving of $1.5 billion over the forward estimates.

Superannuation and trusts

– The budget confirms already released changes to the superannuation system, targeting taxes on paid on superannuation profits: it will limit superannuation tax concessions on superannuant earnings of more than $100,00 a year. But it will extend the superannuation contributions cap to $35,000 for those aged over 60 from July 1 and then extend the higher cap to anyone aged over 50 from July 1, 2014.

– The government has allocated $69.7 million to investigate trust structures used by the wealthy to avoid tax.

Foreign residents

– The government is also set to clamp down on Australia’s foreign resident capital gains tax regime and will implement a withholding policy for foreign residents disposing of assets that incur an Australian tax liability. From July 1, 2016, when a non-resident sells a taxable Australian property 10 per cent of the proceeds will be remitted to the Australian Taxation Office. The regime will not apply to residential house sales under $2.5 million.

Work-related education expenses

– As previously announced, the government will cap work-related self-education expense deductions at $2,000 from July 2014, saving the budget $514.3 million over the forward estimates period.

Multinational companies

– Tightening of the corporate tax system to remove erosion and loopholes, bringing the government extra revenue of about $4.1 billion and $219.20 million in savings.

Families

– A reduction in the time allowed to claim family tax benefits and child-care assistance will save the government $562 million over five years.

– Changes in the eligibility age for another tax benefit will save $76.6 million over four years.